The Debt Management Office (DMO), on behalf of the Federal Government has announced the offer for subscription of the July 2022 Federal Government Savings Bond to investors.
This disclosure is contained in a circular issued by the DMO and can be seen on its website noting that there are 2-year and 3-year savings bonds, with interest rates of 8.075% and 9.075% respectively.
A breakdown of the bonds shows that the 2-year FGN savings bond will be due on July 13, 2024, at 8.075% per annum and the 3-year FGN Savings Bond which will be due on July 13, 2025, at 9.075% per annum.
- Opening Date – July 4th, 2022
- Closing Date – July 8th, 2022
- Settlement Date – July 13th, 2022
- Coupon Payment Dates – October 13th, January 13th, April 13th, and July 13th.
Unit of sale: N1,000 per unit subject to a minimum subscription of N5,000 and in multiples of N1,000 thereafter, subject to a maximum subscription of N50,000,000
A month-on-month comparison shows that the rates for the two tranches are lower compared to 8.205% and 9.205% offered for the 2-year FGN savings bond due June 15, 2024, and 3-year FGN Savings bond due June 15, 2025, respectively.
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What you should know
- According to the disclosure, the security is backed by the full faith and credit of the Federal Government of Nigeria and charged upon the general assets of Nigeria.
- The FGN Savings Bond qualifies as securities in which trustees can invest under the Trustee Investment Act.
- It also qualifies as Government securities within the meaning of Company Income Tax Act (“CITA”) and Personal Income Tax Act (“PITA”) for Tax Exemption for Pension Funds, among other investors.